H.B. No. 5365
 
 
 
 
AN ACT
  relating to the creation of the Austin County Municipal Utility
  District No. 3; granting a limited power of eminent domain;
  providing authority to issue bonds; providing authority to impose
  assessments, fees, and taxes.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subtitle F, Title 6, Special District Local Laws
  Code, is amended by adding Chapter 7984A to read as follows:
  CHAPTER 7984A. AUSTIN COUNTY MUNICIPAL UTILITY DISTRICT NO. 3
  SUBCHAPTER A. GENERAL PROVISIONS
         Sec. 7984A.0101.  DEFINITIONS. In this chapter:
               (1)  "Board" means the district's board of directors.
               (2)  "Commission" means the Texas Commission on
  Environmental Quality.
               (3)  "Director" means a board member.
               (4)  "District" means the Austin County Municipal
  Utility District No. 3.
         Sec. 7984A.0102.  NATURE OF DISTRICT. The district is a
  municipal utility district created under Section 59, Article XVI,
  Texas Constitution.
         Sec. 7984A.0103.  CONFIRMATION AND DIRECTOR ELECTION
  REQUIRED. The temporary directors shall hold an election to
  confirm the creation of the district and to elect five permanent
  directors as provided by Section 49.102, Water Code.
         Sec. 7984A.0104.  CONSENT OF MUNICIPALITY REQUIRED. The
  temporary directors may not hold an election under Section
  7984A.0103 until each municipality in whose corporate limits or
  extraterritorial jurisdiction the district is located has
  consented by ordinance or resolution to the creation of the
  district and to the inclusion of land in the district as required by
  applicable law.
         Sec. 7984A.0105.  FINDINGS OF PUBLIC PURPOSE AND BENEFIT.
  (a) The district is created to serve a public purpose and benefit.
         (b)  The district is created to accomplish the purposes of:
               (1)  a municipal utility district as provided by
  general law and Section 59, Article XVI, Texas Constitution; and
               (2)  Section 52, Article III, Texas Constitution, that
  relate to the construction, acquisition, improvement, operation,
  or maintenance of macadamized, graveled, or paved roads, or
  improvements, including storm drainage, in aid of those roads.
         Sec. 7984A.0106.  INITIAL DISTRICT TERRITORY. (a) The
  district is initially composed of the territory described by
  Section 2 of the Act enacting this chapter.
         (b)  The boundaries and field notes contained in Section 2 of
  the Act enacting this chapter form a closure. A mistake made in the
  field notes or in copying the field notes in the legislative process
  does not affect the district's:
               (1)  organization, existence, or validity;
               (2)  right to issue any type of bond for the purposes
  for which the district is created or to pay the principal of and
  interest on a bond;
               (3)  right to impose a tax; or
               (4)  legality or operation.
  SUBCHAPTER B. BOARD OF DIRECTORS
         Sec. 7984A.0201.  GOVERNING BODY; TERMS. (a) The district
  is governed by a board of five elected directors.
         (b)  Except as provided by Section 7984A.0202, directors
  serve staggered four-year terms.
         Sec. 7984A.0202.  TEMPORARY DIRECTORS.  (a)  On or after the
  effective date of the Act enacting this chapter, the owner or owners
  of a majority of the assessed value of the real property in the
  district may submit a petition to the commission requesting that
  the commission appoint as temporary directors the five persons
  named in the petition.  The commission shall appoint as temporary
  directors the five persons named in the petition.
         (b)  Temporary directors serve until the earlier of:
               (1)  the date permanent directors are elected under
  Section 7984A.0103; or
               (2)  the fourth anniversary of the effective date of
  the Act enacting this chapter.
         (c)  If permanent directors have not been elected under
  Section 7984A.0103 and the terms of the temporary directors have
  expired, successor temporary directors shall be appointed or
  reappointed as provided by Subsection (d) to serve terms that
  expire on the earlier of:
               (1)  the date permanent directors are elected under
  Section 7984A.0103; or
               (2)  the fourth anniversary of the date of the
  appointment or reappointment.
         (d)  If Subsection (c) applies, the owner or owners of a
  majority of the assessed value of the real property in the district
  may submit a petition to the commission requesting that the
  commission appoint as successor temporary directors the five
  persons named in the petition. The commission shall appoint as
  successor temporary directors the five persons named in the
  petition.
  SUBCHAPTER C. POWERS AND DUTIES
         Sec. 7984A.0301.  GENERAL POWERS AND DUTIES. The district
  has the powers and duties necessary to accomplish the purposes for
  which the district is created.
         Sec. 7984A.0302.  MUNICIPAL UTILITY DISTRICT POWERS AND
  DUTIES. The district has the powers and duties provided by the
  general law of this state, including Chapters 49 and 54, Water Code,
  applicable to municipal utility districts created under Section 59,
  Article XVI, Texas Constitution.
         Sec. 7984A.0303.  AUTHORITY FOR ROAD PROJECTS. Under
  Section 52, Article III, Texas Constitution, the district may
  design, acquire, construct, finance, issue bonds for, improve,
  operate, maintain, and convey to this state, a county, or a
  municipality for operation and maintenance macadamized, graveled,
  or paved roads, or improvements, including storm drainage, in aid
  of those roads.
         Sec. 7984A.0304.  ROAD STANDARDS AND REQUIREMENTS. (a) A
  road project must meet all applicable construction standards,
  zoning and subdivision requirements, and regulations of each
  municipality in whose corporate limits or extraterritorial
  jurisdiction the road project is located.
         (b)  If a road project is not located in the corporate limits
  or extraterritorial jurisdiction of a municipality, the road
  project must meet all applicable construction standards,
  subdivision requirements, and regulations of each county in which
  the road project is located.
         (c)  If the state will maintain and operate the road, the
  Texas Transportation Commission must approve the plans and
  specifications of the road project.
         Sec. 7984A.0305.  COMPLIANCE WITH MUNICIPAL CONSENT
  ORDINANCE OR RESOLUTION. The district shall comply with all
  applicable requirements of any ordinance or resolution that is
  adopted under Section 54.016 or 54.0165, Water Code, and that
  consents to the creation of the district or to the inclusion of land
  in the district.
         Sec. 7984A.0306.  DIVISION OF DISTRICT. (a) The board, on
  its own motion or on receipt of a petition signed by the owner or
  owners of a majority of the assessed value of the real property in
  the district, may adopt an order dividing the district.
         (b)  An order dividing a district may create one or more new
  districts and may provide for the continuation of the district.
         (c)  An order dividing the district shall:
               (1)  name any new district;
               (2)  include the metes and bounds description of the
  territory of each of the districts;
               (3)  appoint temporary directors for any new district;
  and
               (4)  provide for the division of assets and liabilities
  between the districts.
         (d)  The board may adopt an order dividing the district
  before or after the date the board holds an election to confirm the
  district's creation.
         (e)  The district may be divided only if the district:
               (1)  has never issued any bonds; and
               (2)  is not imposing ad valorem taxes.
         (f)   A new district created by the division of the district
  may not, at the time the new district is created, contain any land
  outside the area described by Section 2 of the Act enacting this
  chapter.
         (g)  On or before the 30th day after the date of adoption of
  an order dividing the district, the district shall file the order
  with the commission and record the order in the real property
  records of each county in which the district is located.
         (h)  This chapter applies to any new district created by the
  division of the district, and a new district has all the powers and
  duties of the district.
         (i)  A new district created by the division of the district
  shall hold a confirmation and directors' election.
         (j)  If the creation of the new district is confirmed, the
  new district shall provide the election date and results to the
  commission.
         (k)  A new district created by the division of the district
  must hold an election as required by this chapter to obtain voter
  approval before the district may impose a maintenance tax or issue
  bonds payable wholly or partly from ad valorem taxes.
         (l)  The district may continue to rely on confirmation,
  directors', bond, or tax elections held prior to the division.
         (m)  Municipal consent to the creation of the district and to
  the inclusion of land in the district acts as municipal consent to
  the creation of any new district created by the division of the
  district and to the inclusion of land in the new district.
  SUBCHAPTER D.  GENERAL FINANCIAL PROVISIONS
         Sec. 7984A.0401.  ELECTIONS REGARDING TAXES OR BONDS. (a)
  The district may issue, without an election, bonds and other
  obligations secured by:
               (1)  revenue other than ad valorem taxes; or
               (2)  contract payments described by Section
  7984A.0403.
         (b)  The district must hold an election in the manner
  provided by Chapters 49 and 54, Water Code, to obtain voter approval
  before the district may impose an ad valorem tax or issue bonds
  payable from ad valorem taxes.
         (c)  The district may not issue bonds payable from ad valorem
  taxes to finance a road project unless the issuance is approved by a
  vote of a two-thirds majority of the district voters voting at an
  election held for that purpose.
         Sec. 7984A.0402.  OPERATION AND MAINTENANCE TAX. (a) If
  authorized at an election held under Section 7984A.0401, the
  district may impose an operation and maintenance tax on taxable
  property in the district in accordance with Section 49.107, Water
  Code.
         (b)  The board shall determine the tax rate. The rate may not
  exceed the rate approved at the election.
         Sec. 7984A.0403.  CONTRACT TAXES. (a) In accordance with
  Section 49.108, Water Code, the district may impose a tax other than
  an operation and maintenance tax and use the revenue derived from
  the tax to make payments under a contract after the provisions of
  the contract have been approved by a majority of the district voters
  voting at an election held for that purpose.
         (b)  A contract approved by the district voters may contain a
  provision stating that the contract may be modified or amended by
  the board without further voter approval.
  SUBCHAPTER E. BONDS AND OTHER OBLIGATIONS
         Sec. 7984A.0501.  AUTHORITY TO ISSUE BONDS AND OTHER
  OBLIGATIONS. The district may issue bonds or other obligations
  payable wholly or partly from ad valorem taxes, impact fees,
  revenue, contract payments, grants, or other district money, or any
  combination of those sources, to pay for any authorized district
  purpose.
         Sec. 7984A.0502.  TAXES FOR BONDS. At the time the district
  issues bonds payable wholly or partly from ad valorem taxes, the
  board shall provide for the annual imposition of a continuing
  direct ad valorem tax, without limit as to rate or amount, while all
  or part of the bonds are outstanding as required and in the manner
  provided by Sections 54.601 and 54.602, Water Code.
         Sec. 7984A.0503.  BONDS FOR ROAD PROJECTS. At the time of
  issuance, the total principal amount of bonds or other obligations
  issued or incurred to finance road projects and payable from ad
  valorem taxes may not exceed one-fourth of the assessed value of the
  real property in the district.
         SECTION 2.  The Austin County Municipal Utility District
  No. 3 initially includes all the territory contained in the
  following area:
         Being 536.9 acres of land situated in the Miles N. Allen
  Survey, Abstract No. 3, the J.B. Allen Survey, Abstract No. 420 and
  the R.M. Moore Survey, Abstract No. 381, in Austin County, Texas,
  said 536.9 acre tract being all of that certain 536.9227 acre tract
  of land recorded in the name of NESH FARMS HWY. 36, LLC in Document
  Number 214030, Official Public Records of Austin County, Texas
  (O.P.R.A.C.), said 536.9 acre tract being more particularly
  described by metes and bounds as follows; (bearing are based on the
  southwesterly Right-of-Way (R.O.W.) line of State Highway 36 (SH
  36) being South 36 degrees 42 minutes 44 seconds East);
         Beginning at the northerly corner of said 536.9227 acre
  tract, being the northeasterly corner of a called 4.97 acre tract of
  land recorded in Document No. 094014, O.P.R.A.C., also being on the
  southwesterly R.O.W. line of said SH 36;
         Thence, with the northeasterly line of said 536.9227 acre
  tract and the southwesterly R.O.W. line of said SH 36, South 36
  degrees 42 minutes 44 seconds East, a distance of 3,479.28 feet to
  the northeasterly corner of said 536.9227 acre tract, being the
  most northerly corner of a called 270.50 acre tract as shown on map
  recorded in Volume 572, Page 371 of the Austin County Deed Records
  (A.C.D.R.);
         Thence, with the common line between said 536.9227 acre tract
  and said 270.50 acre tract, the following three (3) courses and
  distances:
         1.  South 43 degrees 51 minutes 00 seconds West, a distance
  of 3,633.17 feet;
         2.  North 47 degrees 15 minutes 59 seconds West, a distance
  of 859.26 feet;
         3.  South 42 degrees 47 minutes 12 seconds West, a distance
  of 4,003.07 feet to the most southerly corner of said 536.9227 acre
  tract, being on the northerly line of a called 712.06 acre tract of
  land, Property ID No. 10822, Austin County Appraisal District;
         Thence, with the southwesterly line of said 536.9227 acre
  tract and the northeasterly line of said 712.06 acre tract and the
  northeasterly line of a called 332.00 acre tract of land described
  in deed recorded in Volume 776, Page 340, A.C.D.R., North 47 degrees
  22 minutes 51 seconds West, a distance of 2,495.02 feet to the
  westerly corner of said 536.9227 acre tract, being the
  southeasterly corner of a called 27.85 acre tract of land described
  in deed recorded in Volume 449, Page 507, A.C.D.R.;
         Thence, with the northwesterly line of said 536.9227 acre
  tract, North 42 degrees 47 minutes 29 seconds East, a distance of
  8,277.81 feet to the Point of Beginning and containing 536.9 acres
  of land.
         SECTION 3.  (a) The legal notice of the intention to
  introduce this Act, setting forth the general substance of this
  Act, has been published as provided by law, and the notice and a
  copy of this Act have been furnished to all persons, agencies,
  officials, or entities to which they are required to be furnished
  under Section 59, Article XVI, Texas Constitution, and Chapter 313,
  Government Code.
         (b)  The governor, one of the required recipients, has
  submitted the notice and Act to the Texas Commission on
  Environmental Quality.
         (c)  The Texas Commission on Environmental Quality has filed
  its recommendations relating to this Act with the governor, the
  lieutenant governor, and the speaker of the house of
  representatives within the required time.
         (d)  All requirements of the constitution and laws of this
  state and the rules and procedures of the legislature with respect
  to the notice, introduction, and passage of this Act are fulfilled
  and accomplished.
         SECTION 4.  (a)  If this Act does not receive a two-thirds
  vote of all the members elected to each house, Subchapter C, Chapter
  7984A, Special District Local Laws Code, as added by Section 1 of
  this Act, is amended by adding Section 7984A.0307 to read as
  follows:
         Sec. 7984A.0307.  NO EMINENT DOMAIN POWER. The district may
  not exercise the power of eminent domain.
         (b)  This section is not intended to be an expression of a
  legislative interpretation of the requirements of Section 17(c),
  Article I, Texas Constitution.
         SECTION 5.  This Act takes effect immediately if it receives
  a vote of two-thirds of all the members elected to each house, as
  provided by Section 39, Article III, Texas Constitution.  If this
  Act does not receive the vote necessary for immediate effect, this
  Act takes effect September 1, 2023.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 5365 was passed by the House on May 9,
  2023, by the following vote:  Yeas 106, Nays 36, 2 present, not
  voting.
 
  ______________________________
  Chief Clerk of the House   
 
 
         I certify that H.B. No. 5365 was passed by the Senate on May
  21, 2023, by the following vote:  Yeas 27, Nays 4.
 
  ______________________________
  Secretary of the Senate    
  APPROVED:  _____________________
                     Date          
   
            _____________________
                   Governor